District report favorable to labor-friendly school construction pact

Critics dispute findings, contend policy cost taxpayers millions

School construction report

The report by Rea & Parker Research commissioned by the San Diego Unified School District to assess the Project Stabilization Agreement can be found here.

San Diego  A consulting firm hired by the San Diego Unified School District has found a labor pact that set union-worker hiring goals for school construction projects has not cost the district any additional money and is resulting in projects being completed faster.

Critics, however, say the agreement is costing taxpayers millions of dollars by attracting bids higher than those submitted for projects not covered by the pact and is discouraging non-union contractors from seeking school district work.

The district entered into the Project Stabilization Agreement with the San Diego Building & Construction Trades Council and the Southwest Regional Council of Carpenters in 2009. The pact initially mandated local hiring provisions but was softened before it was adopted to instead include employment goals.

It applies to projects over $1 million under the district’s $2.1 billion Proposition S construction program.

The labor-friendly pact sought to ensure people working on district construction projects would have “the same protections, the same basic rights and benefits” as teachers, bus drivers and other district employees and also ensure jobs would go to local workers, said school board president Richard Barrera,

The study, done by Rea & Parker Research, found that construction bids are coming in under project budgets and that project delays are shorter under labor pact projects.

But the local branch of the Association of General Contractors said it found that project bids submitted under the labor agreement were 9.7 percent less than project budgets, while projects bid in 2009 when the labor pacts were not in place were 31.6 percent below budget.

That nearly 22 percent “premium” has cost the district about $16 million in additional construction costs and could end up costing taxpayers millions in future unnecessary costs, said Jim Ryan, executive vice president of the Associated General Contractors of America’s San Diego chapter.

A district response to the construction industry analysis says it doesn’t take into account changes in market conditions since 2009. “Under their approach, the AGC would compare the price of gas at Shell in 2009 and Mobil in 2010 and come to the conclusion that one brand is more expensive than the other.”

San Diego Unified Trustee Scott Barnett said the building industry was using data that was “cherry picked” and and contended “their facts are just incorrect.” He said the industry is simply opposed to the idea of a labor pact and using any argument because it wants it to fail. Barnett, who formerly headed the county taxpayers association, said he initially was skeptical about labor pacts but now believes the school district agreement is good for taxpayers.

Ryan said his group’s analysis is based on district data and makes an “apples to apples” comparison.

“They are all Prop. S projects, they are all roughly the same size, they are roughly the same type of projects and they are all for the same owner. And they are all in the same city and they are all on schools. There isn’t any difference,” Ryan said.